Wikileaks cable outs secret iiTrial background

news A document published by Wikileaks appearing to be a US diplomatic cable appears to have revealed much of the previously hidden background behind the iiNet/AFACT court case, including the Motion Picture Association of America’s prime mover role and US Embassy fears the trial could become portrayed as “giant American bullies versus little Aussie battlers”.

AFACT is known to represent a number of US-based movie studios in the case, including Walt Disney Pictures, for example, as well as industry associations such as the Motion Picture Association of America and local companies such as the Seven Network.

However, this week Wikileaks published what appeared to be a leaked cable sent from the US Embassy in Canberra (under the name of then-US Ambassador Robert McCallum) to a number of US Government diplomatic branches on 30 November 2008, revealing what appeared to be further details of the case. The cable, seen by Delimiter, claims that although the case against iiNet was filed by a number of local and US content owners and distributors, the prime mover behind it was the MPAA, which has been active in copyright enforcement in the US.

The relative governments which have suffered leaks under the Wikileaks case have repeatedly declined to comment on the substance of the cables leaked over the past year, although they are believed to be genuine. AFACT and iiNet have been contacted tonight for a response to the leaked cable.

An executive from the MPAA, the cable claimed, had briefed the US Ambassador on the matter, confirming it was the mover behind the case, with AFACT essentially functioning as a sub-contractor to the MPAA in the matter and the MPAA having no formal presence in Australia. However, the cable claimed that the MPAA would prefer its role not be made public.

“AFACT and MPAA worked hard to get Village Roadshow and the Seven Network to agree to be the public Australian faces on the case to make it clear there are Australian equities at stake, and this isn’t just Hollywood “bullying some poor little Australian ISP,” the cable quoted the US Embassy as writing.

iiNet, the cable claimed, had been targeted because the ISP was “big enough to be important”, as the third-largest ISP in Australia. The MPAA didn’t go after Telstra, the cable claimed, because the telco was “the big guns” and had “the financial resources and demonstrated willingness to fight hard and dirty, in court and out”. In addition, iiNet users had a particularly high copyright violation rate, the cable claimed, and its management had been “consistently unhelpful on copyright infringements”.

Confidence
The cable also claims that the MPAA believed its case against iiNet to be very strong, as the organisation had delivered a significant chunk of evidence to the ISP revealing copyright violations on the part of its users. However, the ISP did “nothing” to address the issue.

Consequently, to prosecute the case, according to the document, AFACT hired “Australia’s top copyright lawyer” from specialist IP/IT law firm Gilbert & Tobin — a lawyer with experience in previous copyright infringement cases in Australia.

And Communications Minister Stephen Conroy was also consulted, according to the document, with the MPAA speaking with the Labor Senator a few months before the case. At the time, Conroy stated that he had “other priorities” such as the National Broadband Network policy. The MPAA, according to the cable, did not see any role for the US Embassy in that context at that time, but wanted to keep it informed of developments.

In addition, according to the cable, the MPAA saw the iiNet case as potentially “not necessarily their final legal move” in Australia with respect to the issue of online copyright infringement. Although the iiNet case has not yet been concluded in the High Court, AFACT has this year begun again reaching out to Australian ISPs to attempt a dialogue on the issue of copyright infringement.

The US Embassy, according to the document, noted that Australia had “very high rates of illegal movie and television show downloads”, in part because of “the sometimes long gaps between their release in the US and their arrival in Australian theaters or on local television”. The Australian legal action could be followed up by similar moves in other Commonwealth countries, according to the cable.

The US Embassy, according to the document, concluded its report on the issue by noting it would watch the case closely — both for its intellectual property rights implications, as well as “to see whether or not the “AFACT vs the local ISP” featured attraction spawns a “giant American bullies vs little Aussie battlers” sequel”.

opinion/analysis
If the details in the cable are correct, and bear in the mind that they represent the US Ambassador’s interpretation of what the cable says he was told by the MPAA, they would certainly be consistent with many of the guesses which observers of the iiNet versus AFACT case have already made.

It seems very likely — with its key role in this area in the US — that it is indeed the MPAA that is the prime mover behind AFACT, and the trial itself, and that Telstra and SingTel-backed Optus were targets too big for the organisation to go after in Australia. Secondly, it is true that AFACT has been relatively confident of its case against iiNet all the way throughout the trial in Australia’s Federal Court — and still remains quite confident going into its High Court appeal.

It remains true, of course, that there are definitely two sides to the iiTrial. iiNet has a very valid point with respect to its right to not be held accountable for the actions of its users — as the builders of a road would not be held responsible for stolen goods shipped on that road. However, AFACT also has a point — under current copyright law it is illegal to simply download movies via BitTorrent, and targeting ISPs like iiNet would appear to be one effective way to attempt to have that law enforced.

However, there is also the court of public opinion — the public which consumes the content which the studios own and companies like the Seven Network distribute in Australia.

I would bet that the publication of this cable will not aid the case of AFACT and the MPAA in wooing that public opinion. As the cable notes, one of the underlying issues beneath copyright infringement in Australia remains the reluctance by some parties to release their content locally at the same time as the US. I suspect that if that issue was resolved, and online distribution centres such as Hulu extended to Australia, much of the online copyright infringement problem would disappear.

iiNet, and other ISPs, are certainly currently attempting to push the film and TV studios down this path with the release of IPTV offerings.

1. Please don’t link to the leaked cable. Your comment will be deleted if you do.
2. Please don’t quote directly from the leaked cable, other than I have already done. I will also delete those comments.
3. Please confine your discussion to the topic being discussed.

These rules only apply to discussion of this particular story, due to its sensitivity.

No kidding we have higher piracy rates because of delayed releases. They needed to abolish that ridiculous paradigm 5 years ago. I think it’s probably too late now to start doing it, Aussie Mums and Dads are now comfortable torrenting, or asking their kids to do it, it’s no longer just the tech savvy younger generations embracing bittorrent wholeheartedly.

Hulu international was their biggest opportunity to stamp it out before it became as common as owning an mp3 player, and they refused to actually do it.

Wake up and smell the bandwidth. Aussies will not accept it even being released on iTunes at the same time, because we don’t like paying more than the US when our dollar is stronger. Make iTunes prices fluctuate daily based on the exchange rate, like Paypal does… or just sell everything in USD, and you might persuade some people to change their minds, but they missed the window to easily change people’s perceptions, and now they have a big uphill battle, but that doesn’t mean they shouldn’t start it with reasonable measures to make content available here readily and at the same price as the US. not like companies don’t make extra from selling year old models of computers in Aus, and from increased profit margins on all electrical.

Asking because you don’t reference the cable here, and you removed it from the comments section of another article, and that is more or less what MediaWatch was talking about (though the ones on MediaWatch weren’t available at all, in this instance you’re just not giving direct links to them).

Having read the cable I’ll say the most distressing part (and you eluded to this) is that they acknowledge that one of the primary reasons copyright breaches are taking place is due to the time gap between when something is first shown in the US to when it is shown in Australia, but they don’t seem to want to do anything to fix this, and seem to be concentrating wholly and solely on gunning for those doing the breaches.

It’s like they have seen the carrot and admit it would move towards fixing the problem, but refuse to bite it.

Absolutely. they know full well it is their broken business model directly contributing to their perceived problem (high ‘piracy’ rates in Australia). But rather than fix the problem that is the direct cause they want to continue on with their legal cases, only instead of against the users in the US it is against the ISPs here.

if they did not have such tunnel vision we wouldnt be having this discussion nor would the iiNet case have been necessary. theyve spent years pissing away money to the lawyers with not an iota of difference made to the situation on the ground – in fact for all the legal monies spent id say if there was any achievement it is impossible to see it for all the news articles trumpeting how bad a bunch of dirty pirates we are.

All they have to do is sort the rights for Hulu broadcast or other legal services and those problems will evaporate. and you will get a hell of a lot more public goodwill doing that than engaging in the courts, even if not directly with infringers. Fully agree with Renai that public opinion of MPAA – not the best regarded of outfits in the first case – sees them as on the nose, to say the least. same for AFACT. id go further…. in my own estimation the two front groups are nothing but a pack of moneygrubbing bastards.

the sooner the iiNet case is over the better. hopefully iiNet wins again, making the point they need to engage with the ISP industry, not carry out war on them. somehow im not holding my breath for that to happen – theyve shown willingness to stay in their rut, and will only leave it under force.

The TV studios have tried to improve with shows “fast-tracked” from the US but it doesn’t work. They miss a week or 2 due to school holidays, long weekends, easter, summer ratings period, sport on the same network, sport on another network, a one-off special or whatever and then its no longer in line with the US.

Or they move it around so much that people give up trying to follow it to its new time-slot and pirate it instead. Or they do deals to make the content only available on expensive subscription television (Foxtel/Austar).

Movies are just as bad (with many films released weeks or months after the US or not released at all).

Then there is the situation where content is not even available in Australia (either older content that you just cant get from anywhere or content available overseas but not available in Australia)

Some examples of how Aussies get shafted:
1.Young Einstein (Aussie cult classic). Has NEVER been released on DVD by Warner Brothers in Australia (at least last time I looked). Only way to obtain it is to pirate it or (as I did) order it from the US.
2.One of the Garfield movies was available to purchase on DVD from the same online site I bought Young Einstein from whilst it (the Garfield film) had not even launched in the theaters in Australia yet.
3.Many documentaries (including a lot of output from The History Channel) is available on DVD in the USA but not in Australia. If you want to watch it (the History Channel stuff that is), you have to pay through the nose for Foxtel/Austar or pirate it.

BUMP!!! “they don’t seem to want to do anything to fix this” – they know how to fix it, it *will not* cost them a significant amount of money to do so, but they are *TOO SET IN THEIR PROTECTIONIST BUSINESS MODEL* to change in ways which will help everyone in the long term.

This new insight into the dishonest nature of AFACT doesn’t surprise me at all. Fact is if they really had a case as strong as they make it to be then they should have no trouble at all taking on Telstra. Seems they didn’t want to risk it as they already know their claims are pretty flimsy, I think one of them claimed 1.4 billion in “losses” per year due to piracy iirc, lol.

Have watched this trial over the years as it unfolds. While “Intellectual Property” is an important in copy write law and Copyright holders have a genuine right to receive compensation from people using their content it’s the “price” we are paying for this compensation which people object to. If a fair price for effort and distribution where paid there would be a lot les pirating, however the studios as usual want too much. My understanding on how Bit Torrens works is that the electronic article (song, movie) is deconstructed on several “host” computers and sent over the line in small packets to the receiver computer, where it is reconstructed. How can an ISP be held accountable for a string of discontinues 0 & 1’s being transmitted through its system. It’s not pirated until it is usable so it is only the end user who can be the pirate

That is one of the most elegant arguments for iiNet I have seen in a while. Your understanding is correct and the argument appears sound. It is a shame that AFACT, the MPAA etc. are only focused on litigation rather than innovation with regards to piracy.

The US Embassy, according to the document, noted that Australia had “very high rates of illegal movie and television show downloads”, in part because of “the sometimes long gaps between their release in the US and their arrival in Australian theaters or on local television”.

Online viewing of TV and movies is just like MP3 audio in the early days. The only way to load up that 128MB music player was to break the law of the time and rip CDs, or save the effort and get MP3 files from friends or off the internet. There simply wasn’t a legal way to do something that was desirable. The DRM crippled offerings from music companies were not competitive. My experience with CD-like discs with copy protection meant I won’t buy another SecureRom disc again (won’t play in the car CD player). Now that tagged, but non-DRM, MP3/AAC files are available for purchase, that’s how I get music.

The lead time between Australia and the US for new shows has reduced, but I think that is reflecting the ‘alternative distribution channel’ that is BT. I’d much rather use my PVR and record a show in HD off the way and not fart around with BT, transferring etc. BT becomes attractive (so I am told) when the TV stations here only show SD versions, cut too much to fit the adverts in or they take too long.

When I hear about Netflix deals in the US for $10/mth I get envious. Why risk the nasty-grams from your ISP and the chance of ‘bad things’ happening to your PC if you could legally watch TV and movies for $10-$15 per month? I’d sign up immediately, provided the service was stable. TPG’s IPTV is kind of OK, but WiFi access only seems to work in Linux and not Windows. Wired access is fine, but who wants to watch TV at the ADSL modem?

I think that most people do the right thing when they have a chance. We’re not all thieves by nature, and so it would be best if we were given the chance to consume digital media legally.

Having played around with Netflix via VPN I can say it’s a pretty average quality service, the video is just SD and doesn’t look overly flash at all (and they seem to concentrate a lot on mailing out DVDs). Hulu on the other hand provides HD quality.

But all that aside, last night I was flicking through iView and started watching the first season of Gruen Transfer since I hadn’t seen since it was on, and honestly the quality there would be all that’s needed for TV show streaming, you don’t need it to be HD, surround sound, etc, you just need it to be watchable.

So watch it online, if you want better quality buy the DVD/Blueray, pretty straight forward, only real issue is getting it broadcast on TV quicker.

Big kudos towards the ABC for not being complete arseholes with their content. No advertising and free, the way it should be. Making money with media needs to diverge far from the tacky and more towards savvy.

I think its blatantly obvious that Australians will not down the kool-aid cup of American consumerism. We are not ignorant enough to. The ‘evil empire’ was always too dumb and obtuse to work long term and is now failing from its own systemic greed and lust for the bottom line.

Online TV, Video download services and online games distribution platforms are only useful for people with fast Internet. I’m 5mins south of Coffs Harbour and I’m lucky to get 3Mbit at the best of times on an ADSL2 connection.

MPAA needs to recognize the other big problem. When the illegally obtained product is outright easier to use than the one you are trying to sell there is an issue. The market failure is of your own making. I personally have a problem with the way copyright laws are set up. Copyright should be about protecting the artist not the corporations.

As a side what is this Copyright Theft I’m starting to see referred to. If the Copyright was stolen you wouldn’t be able to produce the copyrighted material any more.

In theory, I am all for the major businesses promoting a lot of their films and TV series globally through an “instant stream” option for a small fee. I think it’s a great idea and I would be more than willing to pay for a stream, as opposed to forking out around $50 for a dvd order, with postage. Amazon are increasingly doing this, but some of it’s restricted to the US in my understanding. As touched on in this article, Australians have to wait for content to be released here and also have less access to some of the online streaming options available for copyright reasons. However….wait for it….THE INTERNET FILTER. The filter is going to kill any ideas you might have of doing instant streams via a fee (even if approved by US business sector), as many are not likely to face our draconian censorship laws, relating to terrorism, force, violence and fetish material. Also, the Labor government are doing an inquiry into the classifications code in Australia.

nah. i dont think the filter is as big a problem as you say – one thing it wont be able to manage is an encrypted VPN stream. as long as a vendor offers that sort of stream it should be able to punch through the filter? DPI will see its video but wont be able to determine what the content is – under encryption it could be a teleconference stream or it could be a fetish vid. and would be made to producer standards – you suggest US ones – not to the standards controlling what australian consumers get. so i dont think that will be as big a deal as youve suggested.

I urge people to also check out the technical side of NBN in relation to deep packet inspection (DPI). In my understanding, it is currently illegal for the government and/or an ISP to use DPI without a warrant, but it can break the backbone of p2p file sharing, bit torrent etc. DPI is also very hard to crack, even with proxies and virtual private networking or ssh tunneling. All the government would need to do is change the legislation so DPI can be enshrined in the NBN for torrents etc.

The NBN is just layer2 VLAN tagging, and although it would technically be possible to extract the layer3 packet and read it’s contents, the amount of processing power and resources required to do it in real time just wouldn’t be feasible.

If the government wanted to view traffic then they would directly approach the service providers, just like they do now.

The NBN is just layer2 VLAN tagging, and although it would technically be possible to extract the layer3 packet and read it’s contents, the amount of processing power and resources required to do it in real time just wouldn’t be feasible.

If the government wanted to view traffic then they would directly approach the service providers, just like they do now.

You’d think Telstra would be mobilising a battery of Lawyers right now and sending them over to iiNEt to help out as its obvious from the cable that iiNet was carefully selected as the MPAA knew they would be an easier target. Once they eventually get iiNet – and lets face it, our legal system is trying to help them out as much as possible here despite ruling aginst them every time so far, but encouraging them to persue it further, you can bet your balls that once they get a legal precedent its going to be far easier to take on and beat Telstra and all teh other Australian ISPs.

Out of curiosity. Has the MPAA been successful with similar actions against US ISPs in the US??

Could it be that they know if they release the content at the same time here they would have to charge the same price as they do overseas and they would not be able to charge the ridiculous high prices they do now when they release their product months later and rip certain markets off for a lot more profit ?
They are saying the ISP is responsible for what users do on the ISP’s network I wonder what they will do when (hypothetically) somebody sues them for aiding and abetting a person who hires or buys their violent movie and then goes out and re-enact a murder scene from their movie ?
Typical American ethos of GREED IS GOOD,

BIGPOND movies and other content providers that pay US studios in USD havnt reduced their fees in light of 30% increase in the AUD. They are the ones forcing people on to piracy, US studios should attack them to reduce their prices so there is less incentive to pirates and then the studios will gain in revenue. The studios should be suing BigPond movies for decreasing their revenue stream

Media Pirates are to Movie and Television studios like the Papparazi are to celebrities. You’ve got no hope in hell of ever getting rid of them, so you might as well figure out a way to give the people what they want on your terms.

And people know that. Distributors will even admit (behind closed doors, perhaps) that the delays in distribution are an issue. When cornered, they will feign ignorance and claim it’s not the distributors problem that distribution isn’t distributing.

High-speed international links means content can shift between other sides of the globe rapidly. Never mind many TV shows are recorded and released to distributors before they screen. You don’t really need to ship everything air-freight by tape reel any more. ;)

Pirates will always exist. There is no model that will prevent it. Sorry.

However, there is a veritable chasm between the “pirate” whom is simply trying to keep up with the US centric distribution of content, and the “pirate” whom is either distributing for the lulz, because they can, or for profit.

One could argue that the method used is really irrelevant, if the goal is simply personal viewing. The Industry knows that market is big. Really big. But they will not cannibalise existing markets. Because those markets carry an eye-watering degree of return. When you’re hooked on a drug, you’ll damn well do almost anything to keep it.

It’s easier to litigate.

The change in tack from AFACT, whom really are just the cog in the greater protection racket that is the MPIA and RIAA (and indeed the industry as a whole) is that they aren’t (really) interested in ‘unauthorised distribution’, they’re now going after Joe Bloggs and his internets.

The Industry has always treated the end consumer as a never-ending pot-o-gold, where if you can’t sell them three CD’s, you can always claim the three CDs they downloaded somehow has morphed into a loss of $150,0000+ in sales.

Online distribution is a profit line for the Industry, it is, however, less profitable than claiming vastly inflated costs, then adding legal fees. Litigation is good for business, and boy, businesses is boomin’.

And the kicker? it means you don’t have to involve the local/ federal constabulary and court costs for warrants and writs so they can kick some poor gran’s door down to raid the basement located DVD/ blue-ray copying house. Just sue gran for $250k for a single copy of ‘achy breaky heart’.

SCO figured the same approach would work. Why fight in court, when you can just use the “if you don’t pay money, your window is right gonna break, know what I’m sayin?'” In time it became apparent that the claims became increasingly less relevant. It didn’t stop Microsoft (and others) taking advantage of a community for profit.

One might argue that the recent AFACT attempt to subvert court proceedings, which eventually (and ironically) led to court action, and the resulting negative press, is a bit damning. I think most of us figured that iiNet was to be an “example”. If you go after Telstra, you better have a f*cking water tight case, or they’ll emulate dry humping a photo-copier. Near your person.

That AFACT were effectively instructed to dodge Telstra, whom have the financial clout (and well seasoned litigation team) clearly indicates that FAR from believing they have a valid complaint, it’s devolved to “smash the sort-of-little-guy as a warning to others”.

Artists are increasingly distancing themselves from the school yard bully. The internets make it far easier to get your five minutes of fame than any promoter from the 80’s could ever hope to achieve. And it also means if you screw over your customers, they *will* go elsewhere.

Whether the Industry ever adapts, or fights to the bitter end, that’s going to be the fascinating part.

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